Baird, whose criminal plea was accepted by a federal judge in a Florida district court last week, was fined $17 million, the largest BIS civil penalty ever imposed on an individual. The penalty, of which $7 million was suspended, also included a five-year denial of export privileges, with one year suspended.
“BIS brought this action because of the serious potential harm to national security inherent in a business model where companies consolidating or forwarding packages abroad conceal from U.S. merchants the location of foreign customers and the fact that items are intended for export,” said BIS Special Agent-in-Charge Robert Luzzi in a statement.
“As a result of these deceptive practices, U.S. merchants’ compliance programs may be unable to detect potential unlicensed exports and other violations,” he added.
In February 2017, Access USA Shipping settled with BIS and agreed to pay a fine of $27 million for the numerous violations of the Export Administration Regulations (EAR). About $17 million of the $27 million penalty had been suspended for a two-year probationary period for the company.
According to the settlement, Access USA settled 129 counts of evasion, 17 counts of exporting or attempting to export “crime control” items without the required Commerce licenses and four counts of exporting or attempting to export to a sanctioned entity on the BIS Entity List without the proper license. According to BIS, the company facilitated the exports of rifle scopes, night vision lenses, weapons parts and other EAR 99 items.
Access USA, a mail and package freight forwarder, operates as a so-called fourth-party logistics service by providing overseas customers with a U.S. physical mailing address and a “suite” — or designated space at its warehouses — for items purchased from U.S. merchants that were ultimately intended for export.
In other instances, the company offered a “personal shopper” or “alternative” program, whereby an Access USA employee presented himself or herself to the U.S. merchant as the purchaser of the products. BIS noted in some cases Baird directed or authorized Access USA employees to use his personal credit card information.
“The activities that Baird knowingly authorized and/or participated in resulted in unlicensed exports of controlled items to various countries, as well as repeated false statements on Automated Export System (AES) filings,” the agency said.
Access USA was founded in 1997 and, in addition, conducted business as MyUS.com. The company’s lead executive at the time covered by the BIS investigation was Baird, founder, CEO and president (though Ramesh Bulusu is listed as “president of Access USA Shipping LLC” on the Commerce Department’s charging documents).
The export violations first began in April 2011. BIS investigators highlighted 150 violations through Feb. 15, 2013. These illicit shipments were destined to end users in South Africa, Saudi Arabia, Japan, Kazakhstan, Malaysia, the United Kingdom, Italy, Germany, France, Sweden, Finland, Austria, Switzerland, Hong Kong, Maldives, Zambia, Indonesia, Nigeria, Turkey, Georgia, Turks and Caicos, Guadeloupe, Cypress, United Arab Emirates, Philippines, Thailand, Argentina, Yemen, Taiwan and Libya.
As far back as 2009 and 2010, Access USA was even warned by another private package carrier to properly describe and value items in its Automated Export System filings. A BIS special agent issued the same guidance to the company in January 2012. In September 2012, Access USA’s then chief technology officer (not named in the charging documents) warned Baird against “willingly and intentionally breaking the law.”
On Jan. 24, 2013, Access USA’s Sarasota warehouse was raided by federal and state law enforcement, which led to the start of the BIS investigation of the company.